Bond yields decrease; rupee continues to strengthen

•  All time high volume on offer at Treasury bill auction

By Wealth Trust Securities

The secondary bond market yields decreased yesterday ahead of today’s weekly Treasury bill auction. Activity was witnessed on the 01.07.25, 15.05.26, 01.05.27 and 15.09.27 maturities at levels of 29.20%, 29.00% and 27.30% each respectively against its previous day’s closing levels of 29.50/30.50 each, 28.30/60 and 28.20/50 respectively.

Today’s weekly Treasury bill auction will have an all-time high volume of Rs. 180 billion on offer, surpassing its previous all-time high of Rs. 160 billion. This reflects an increase of Rs. 40 billion over its previous weeks offered amount as well. The auction will consist of Rs. 90 billion on the 91-day maturity and Rs. 45 billion each on the 182-day and 364-day maturities.

At last week’s auction, the weighted average rate on the 91 day bill decreased by 02 basis points to 25.80% while weighted average rates on the 182 day and 364 day bills remained steady at 25.42% and 23.14% respectively. An amount of Rs. 132.42 billion was accepted at the 1st phase of the auction against a total offered amount of Rs. 140 billion while a further amount of Rs. 42.58 billion was raised at its phase II.

The total secondary market Treasury bond/bill transacted volume for 15 May 2023 was Rs. 2.59 billion.

In money markets, the weighted average rates on overnight call money and REPO stood at 16.40% and 16.33% respectively while the net liquidity stood at a surplus of Rs. 46.09 billion yesterday. An amount of Rs. 28.85 billion was deposited at Central Banks SDFR (Standard Deposit Facility Rate) of 15.50% against an amount of Rs. 74.94 billion withdrawn from Central Banks SLFR (Standard Lending Facility Rate) of 16.50%.

Forex Market 

In the Forex market, the USD/LKR rate on spot contracts were traded within the range of Rs. 309.30 to Rs. 311.70 yesterday before closing the day at Rs. 309.00/309.80 against its previous day’s closing level of Rs. 311.70/312.20.

The total USD/LKR traded volume for 15th May was $ 28.05 million.  

(References: Central Bank of Sri Lanka, Bloomberg E-Bond trading platform, Money broking companies)